Brooten v. Hickok Rehabilitation Services, LLC
348 Wis. 2d 251, 831 N.W.2d 445, 2013 WI App 71 (2013)
Rule of Law:
Exculpatory clauses in Wisconsin are disfavored and strictly scrutinized against the party seeking to enforce them, deemed unenforceable as against public policy if they lack bargaining opportunity, are impermissibly broad, or exceed the reasonable contemplation of the parties.
Facts:
- Ronald Brooten was injured at Chetek Fitness 24/7 when a weight bench he was using collapsed from a flat to a decline position.
- The bench collapsed because its adjustable T-bar was loose and shifted laterally.
- The weight bench, manufactured by Hoist Fitness Systems, Inc., and purchased new by Chetek Fitness, did not have any locking mechanism to secure the T-bar.
- According to Hoist's product support manager, Mario Lopez, the bench's supporting bolts were not sufficiently tightened, and the product was incorrectly assembled or maintained.
- Chetek Fitness 24/7 requires every customer, including Brooten, to sign a 'Waiver and Release of Liability' form before they are permitted to use the facility.
Procedural Posture:
- Ronald Brooten brought common law negligence, safe place, and strict liability claims against Chetek Fitness 24/7, its insurer West Bend Mutual Insurance Company, 2nd Wind Exercise Equipment, and Hoist Fitness Systems, Inc., in a circuit court (trial court).
- Brooten subsequently abandoned his strict liability claim.
- The circuit court granted summary judgment in favor of Chetek Fitness 24/7 and West Bend Mutual Insurance Company, ruling that the exculpatory waiver Brooten signed was enforceable and barred his claims.
- The circuit court also held that if its decision on the waiver was incorrect, there was sufficient dispute of material facts for the case to proceed on a safe place theory.
- Ronald Brooten appealed the summary judgment decision to the Wisconsin Court of Appeals.
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Issue:
Is an exculpatory waiver signed by a health club member enforceable if it was presented on a take-it-or-leave-it basis, is impermissibly broad in scope by purporting to release claims beyond negligence, and exceeds the reasonable contemplation of an ordinary consumer?
Opinions:
Majority - Hoover, P.J.
No, an exculpatory waiver signed by a health club member is unenforceable if it was presented on a take-it-or-leave-it basis, is impermissibly broad in scope by purporting to release claims beyond negligence, and exceeds the reasonable contemplation of an ordinary consumer. The court concluded that Chetek Fitness's liability waiver was contrary to public policy and therefore void and unenforceable, consistent with Wisconsin's strong disfavor for such agreements. The court identified three public policy grounds for unenforceability: (1) The waiver was presented on a 'take-it-or-leave-it' basis, lacking an opportunity for Brooten to bargain over its terms, which is a significant factor against enforceability, citing Atkins v. Swimwest Family Fitness Ctr. and Richards v. Richards. (2) The waiver was impermissibly broad and all-inclusive, extending beyond mere negligence to include 'breaches of contract, or other causes' and purporting to waive liability for 'NEGLIGENCE OR ANY OTHER CAUSE.' Wisconsin law strictly limits exculpatory clauses to claims of negligence, prohibiting them from precluding claims based on reckless or intentional conduct, as affirmed in Rainbow Country Rentals & Retail, Inc. v. Ameritech Publ'g, Inc. and Richards v. Richards. (3) The waiver exceeded the contemplation of the parties because it failed to clearly, unambiguously, and unmistakably inform Brooten of what was being waived, and did not adequately alert him to the nature and significance of what he was signing, per Yauger v. Skiing Enters., Inc. Specifically, the 'defend and indemnify' language was buried and unlikely to be understood by an ordinary consumer, and the repeated emphasis on 'negligence' while also including 'other causes' could mislead a customer into thinking they were not waiving claims for more egregious conduct.
Analysis:
This case reinforces Wisconsin's strong public policy disfavoring exculpatory clauses, particularly those used by businesses offering services to the general public. It provides a clear framework for evaluating such clauses, emphasizing the necessity of a bargaining opportunity, a narrow scope limited to negligence, and clear, unambiguous language that aligns with the reasonable understanding of the signer. Future cases will likely scrutinize waivers even more closely, requiring careful drafting to avoid overly broad language, inclusion of indemnity provisions without clear disclosure, or misleading terms, ensuring they do not contravene public policy.
